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Kiwi Dollar Pressured By China News
China’s weak data had a one-two punch on the Forex market, with commodity-currencies suffering alongside the drive higher for safe haven pairs. China’s Manufacturing PMI reports were a mixed bad for the most part, with very little positive sentiment for a single report which managed to edge slightly higher. Overall, the outlook looks dismal with manufacturing continuing to contract in China, with readings on the manufacturing PMIs below the 50.0 threshold which separates contraction from expansion. The only “bright” spot was the 48.4 reading, slightly above expectations of 48.0, for the Caixin Manufacturing Report, yet still well into... -
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Crude Sinks To Day Lows After Goldman Explains Why No Oil Production Cuts Are Coming
Moments ago, following last week’s torrid crude oil price rebound driven entirely by now-denied hopes of some production cut consensus between oil suppliers, namely Russia and Saudi Arabia, oil halted its four-day rally as weak Chinese manufacturing data added to economic demand concern. “The risk seems to be the greatest on the downside again” and speculation of OPEC production cuts has “faded fast,” says Saxo Bank head of commodity strategy Ole Hansen. “China and South Korea are both helping the market return to fundamental focus where it is worried about demand.” But the biggest downward catalyst overnight as noted pr... -
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Energy Again
I believe there’s an old saying about how it’s better to be lucky than smart. I’m seeing an example of that today, since I had been short Alere (ALR), and I closed it at a nice profit last Thursday. I see this morning that it’s up nearly 50% due to a takeover. That’s a bullet I’m glad I dodged. Sheesh! It seems that the fantasy world of Kuroda (“negative interest rates will surely bring prosperity to the people”) has been shoved aside once more by reality from China (“down, down, down goes the economy”) and I’m seeing a lot of red that was annoying absent on Friday. Let’s hope it stays that way, with crude, once... -
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The Life-Changing Magic Of An Asset Allocation Plan
You have to have a plan and stick to it. This wisdom from U.S. Global Investors Fund Manager Ralph Aldis is true for investors and mining companies. And it may be even more true when the market seems to be careening from one disaster to the next. In this interview with The Gold Report, Aldis shares seven companies he is sticking with come low gold prices or a high Purchasing Managers Index. The Gold Report: This year started with a bang as China’s machinations rocked markets all over the world and set off a gold rally. Is that sustainable? What did we learn? Ralph Aldis: China was the main driver of the volatility that started out t... -
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Twitter Shares Rise Off Talk Of Andreessen, Silver Lake Deal
From USA Today: Shares of Twitter jumped nearly 8% in pre-market trading Monday following a report Silicon Valley investor Marc Andreessen and firm Silver Lake Partners weighed a deal. According to The Information, several investors in Silicon Valley are pulling together plans to buy or restructure the company. Talk of a potential acquisition follows upheaval in its management ranks, with several executives including the heads of product and engineering leaving Twitter, CEO Jack Dorsey confirmed last month. The company is also expected to unveil new board members when it reports quarterly earnings next week. Once again, the big question for i... -
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EC A Fractional Increase In The Buffett Valuation Indicator
Market Cap to GDP is a long-term valuation indicator that has become popular in recent years, thanks to Warren Buffett. Back in 2001 he remarked in a Fortune Magazine interview that “it is probably the best single measure of where valuations stand at any given moment.” The four valuation indicators we track in our monthly valuation overview offer a long-term perspective of well over a century. The raw data for the “Buffett indicator” only goes back as far as the middle of the 20th century. Quarterly GDP dates from 1947, and the Fed’s balance sheet has quarterly updates beginning in Q4 1951. With an acknowledg... -
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FTSE 100 Pullback On China PMI Figures, ISM On Tap
After last week’s strong run, the FTSE 100 is giving back some of its gains. The strong gains in commodities and the Bank of Japan reducing rates to negative are both supporting the FTSE 100 and are expected to underpin strength in the weeks ahead. However, in the short-term, the mixed China PMI figures which were published overnight are enough of a motive to book gains, but the generally overbought conditions could also be said to be helping trigger a softer FTSE 100 this morning. According to my short-term fair-value-model, the FTSE 100 rose more than was justified by commodity markets (Bloomberg Commodity Index) and by the DAX 30. Both ... -
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New Purchase: Emera
Following up on my article last week that covered my first purchase in my children’s tuition fund, I’m updating my portfolio with a second purchase. I actually bought shares of 4 different companies in January, but I thought it was more fun to discuss them over 5 different weeks hahaha! As the market dropped like a rock over the first three weeks of 2016, I looked at some interesting picks for a 10-15 year investment horizon. I purchased 50 shares of Emera (EMA) (EMRAF) Investment Thesis As long as EMA is using this cash flow to generate more projects, we should see consistent sales growth. Notably, 2 projects (a participation in Mar... -
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WTI Crude Oil And Natural Gas Forecast – February 1, 2016
WTI Crude Oil The WTI Crude Oil market gapped higher initially during the day on Friday, and then went back and forth to show quite a bit of volatility. The volatility of course suggests that the market is still a bit confused, but could eventually find enough momentum to do something. Given enough time, I still think that the sellers come back into this market, so I’m a bit hesitant to go long at this point in time. I feel that we will eventually reach down towards the $28 level again, and that the $36 level above is going to be resistance. Any type of resistant candle near that area should be an opportunity to take advantage of the rally ... -
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Japanese Negative Interest Rates A Boon For Share Traders
Japanese negative interest rates a boon for share traders The Bank of Japan (BOJ) unexpectedly cut interest rates to negative levels. The Japanese central bank’s decision to lower the benchmark rate to -0.1% – published during the early GMT hours of Friday – implies that deposits made by commercial banks will bear interest towards the BOJ. However, because of this cost, the banks might instead be driven to lend more funds to both the private and business sector and hence boost the currently sluggish local economy which is in great need for additional investment and spending. Following the decision, Japanese shares rallied while the U.S....
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